5 cost saving strategies to reduce your IT spend by 30%
Is it possible to lead an inspiring IT department, that drives the business culture towards growth and pioneers revolutionary transformation, while simultaneously keeping management happy and the CFO on board? Here are our top tips:
Align your IT costs to the value of each service
If your CFO has a drained face, a look of bemusement in his eyes and frequently uses the word despair when describing your IT budget, you need to align your IT costs to the value of your services. But why do this and what does this mean? It means: What value does each business service derive from the underlying IT cost. Accurately assigning the true value of an IT service makes it easy to visualise which services can be trimmed without end user impact.
Relating IT cost to the value of a business service helps determine where you are under-investing, as much as over-investing. Doing a thorough cost justification exercise for all IT investments and in depth knowledge of excellent IT service management is essential. An IT cost audit, driven by experts, is a great place to start.
- Invest in IT cost analytics software
There are a raft of cost analytics tools available on the market. However, here in the UK, there are only a few that analyse IT costs. We are not talking about just getting Excel to do a few sums and tricks, we are talking a whole new layer of insight that integrates with market leading network discovery tools. Accordant’s software, AccSL® takes data from spreadsheets and diverse sources, making the numbers sing and dance, telling their individual stories, while painting pretty pictures and pie charts to make a CFO’s heart rejoice. It is this rich, detailed business intelligence, along with expert guidance and Accordant Solutions’ in depth knowledge of IT strategy that drives solid cost savings (around 30%) and revolutionary IT transformation.
- Engage with IT cost saving experts
IT Financial Management consultants, (ITFM), like Accordant Solutions, are armed with IT cost savings software that does a full audit of your IT costs. This software, together with their expert knowledge, typically saves you 30% of your overall IT spend, while improving the quality and value of services.
- Make friends with finance
When it comes to making IT cost savings, IT and finance should act like best buddies, working together towards a common goal. All too often the relationship breaks down because technologists, naturally, talk in technical jargon that is not shared, nor easily understood by the business; CFOs may be bamboozled by this voodoo talk and turn back to the comfort of their spreadsheets thinking things like “IT is a black hole of costs”. However, as budgets get squeezed, the finance department can be your best advocate to senior management when it comes to cost savings. By nurturing strong relationships and producing detailed cost analysis, the FD can both narrate and translate your IT cost reports to senior executives, whilst simultaneously evangelising the business value of your services.
- Harness the gift of foresight in the Capex/Opex debate
When innovating company culture change and IT transformation, it is easy to just assume more processing power/memory, upgrades and cloud migration is the way to go to solve all the problems. However, when building accuracy and trust in IT costs, it is also important to fully analyse Capex vs Opex scenarios and a longer-term model, ensuring where appropriate that the IT strategy supports the business strategy.
Using an IT cost savings software like Accordant’s AccSL® allows you to model various outcomes using “what if scenarios”. AccSL® allows you to manipulate complex data sets (such as IT services typically produce) and by tweaking various metrics to predict how changes and options impact the finances. Best of all, a robust “what if scenario” makes the CFO sit up and take notice. A well deployed IT cost justification exercise also takes the guess work out of IT investment, building buy-in from senior management by making the business case for you in a financially grounded and repeatable way.
Call now to talk about your IT department’s objectives with our team of expert IT Financial Management experts. 0800 118 2390